While fund boards have come under attack for rubberstamping contracts with poorly performing advisors, the World Funds Genomics Fund has quietly tested the conventional wisdom. After woefully underperforming both the market and its peer group for two years, the fund has swapped subadvisors and turned around its performance.

Under founding portfolio manager Steve Newby the fund lagged its peer by 30 percent in 2001 and nearly 40 percent in 2002, according to Morningstar. Then, at the start of this year the fund changed horses and tapped Robert J. Sullivan, a Fidelity veteran now at Satuit Capital Management to handle its portfolio. Through April, the fund was up the 27.22 percent for 2003, a performance that puts it 20 percent ahead of its peer group.

"Newby wanted to go in a different direction," explained Sullivan. "He decided that he did not want to run the fund anymore." At that point the directors recommended Commonwealth Capital Management as the new advisor for the $7 million fund. Commonwealth, in turn, hired Scituate, Massachusetts-based Satuit as the fund's subadvisor. Shareholders approved the changes in May.

While the sub-advisory deal brings Satuit new assets, Sullivan does not foresee any changes to his firm's long-term business model in response to the deal. First and foremost, he says Satuit plans to stick to a disciplined investment strategy. Only if the fit is right with the fund will it sign on.

"We are in negotiations with a few firms to subadvise other funds," he explained. But he stressed that the firm will not take mandates just to grow its business noting that Satuit has declined subadvisory mandates offered by two other funds in the past couple of years.

In this case Sullivan was attracted to take the mandate by opportunities that he saw in the healthcare/biotech industry. "Everything that could have possibly gone wrong over the past eight years in that sector happened, including inflated asset values," he said. "Valuations got out of control and in a lot of ways valuations of companies are coming down to more fundamental levels for the industries that they are in."&nbsp